Hearing of the House Committee on Oversight and Government Reform - Blackwater USA; Private Security Contracting in Iraq & Afghanistan
Interview
Hearing of the House Committee on Oversight and Government Reform - Blackwater USA; Private Security Contracting in Iraq & Afghanistan
BREAK IN TRANSCRIPT
REP. PETER WELCH (D-VT): Thank you, Mr. Chairman.
Mr. Prince, thank you for coming. I want to ask a few questions about the finances. My understanding is that Blackwater had contracts with the federal government in 2001 in the amount of $736,000.
MR. PRINCE: Could easy be. Yes, sir.
REP. WELCH: And in 2006, that number had exploded to $593 million.
MR. PRINCE: Could I have just one minute, please?
I'm not sure.
REP. WELCH: Well, you don't dispute it. This is what's in the report that was referred to earlier.
MR. PRINCE: Well, some of the later years on that report aren't quite accurate so I'm not going to discount the whole thing, but --
REP. WELCH: Okay. According to the report, 51 percent of the Blackwater contracts were no-bid contracts -- 493 million (dollars) that were explicitly no competition and 30 million (dollars) for awards after limiting or excluding qualified bidders. Is this more or less correct? Any reason to dispute it?
MR PRINCE: It could be, sir. I don't know.
REP. WELCH: And since 2003 when the war began, your -- Blackwater contracts have exceeded $1 billion. Correct?
MR. PRINCE: All right. I don't know the answer sir. If you have got specific questions on financials, we'll get you the answers.
REP. WELCH: Well, these are facts that are in the record.
You can check them out, but I'll just advise you --
MR. PRINCE: Well, there's some stuff in the chairman -- in the committee's report that are not accurate, so I can't agree to the entire committee's report.
REP. WELCH: Well, let me continue going through this. One of the concerns that's been expressed is that a sergeant who provides security services in the full military setting is paid $50,000- $60,000; an employee from Blackwater the cost to the taxpayer's about $445,000. Is that more or less correct?
MR. PRINCE: Could you read -- may I have a copy of what you're reading from, at least?
REP. WELCH: Well, you've been asked about this by several members already.
Let me just continue. Let's talk a little bit about training. You were a SEAL and served with distinction, as I understand, as a SEAL, correct?
MR. PRINCE: Yes.
REP. WELCH: And your training as a SEAL was beneficial to you in the work that you're doing now as the head of this agency -- this company?
MR. PRINCE: It helped form me and my life -- absolutely.
REP. WELCH: And you, I think, also indicated that Blackwater hires our military veterans and law enforcement veterans -- many of whom have recent military deployments, correct? It makes sense to do that.
MR. PRINCE: Yep.
REP. WELCH: So it's fair to say that Blackwater, as a company in recruiting personnel, has benefited from the taxpayer-financed training of people that Blackwater hires, correct?
MR. PRINCE: We take people that have prior honorable military service and provide them an opportunity to use those skills again at their highest and best use.
REP. WELCH: And it's fair to say that Blackwater contracts have in fact surged since 2003 when the war began, correct?
MR. PRINCE: The nature of the security environment around the world has changed, yes.
REP. WELCH: And it's true -- or is it true that as reported by the Center for Responsive Politics, you did make -- as you have a right to make -- contributions of $225,000 to the -- that included $160,000 to the Republican National Committee and the National Republican Campaign Committee?
MR. PRINCE: I don't know that sitting here right now. Again, I can go back and dig through our contribution records to figure out exactly what we gave at what period.
REP. WELCH: Well, that's the report that we've been given. And again, you have a right to do that. My concern is the nature of the contracts.
Now, you are also aware that General Petraeus, who's in command of 160,000 troops, is paid by taxpayers $180,000 for the extraordinary responsibilities that he bears for our security in Iraq, correct?
MR. PRINCE: I don't know what General Petraeus gets paid.
REP. WELCH: That's what it is.
Blackwater had 861 or so personnel, according to this report, in 2006 in Iraq. Is that more or less right?
MR. PRINCE: Could be, yes, sir.
REP. WELCH: All right. General Petraeus is paid 180,000 (dollars) for supervising 160,000 troops. How much were you paid in 2006?
MR. PRINCE: I'll get back to you with that exact answer. I don't know.
REP. WELCH: Well, you can give me an estimate.
MR. PRINCE: More than $1 million.
REP. WELCH: Well, as I remember, when my colleague, Mr. Hunter, asked you what your -- about your contracts, you indicated 90 percent of your Blackwater contracts came from the federal government, correct?
MR. PRINCE: Yes.
REP. WELCH: I.e., the taxpayer. And he asked you what your profit margin was. And my recollection of your testimony today was about 10 percent.
MR. PRINCE: That's what the report that we submitted to the committee says, yes.
REP. WELCH: So walk through the math with me: If Blackwater's had $1 billion in contracts since the war began in 2003, and there's a 10 percent profit margin, that's $100 million in profit, is it not?
MR. PRINCE: This is a representative of one -- of the WPPS contract. Some contracts we lose money on. Some we lose all kind of money on. Some we make money on.
REP. WELCH: Mr. --
MR. PRINCE: We -- understand we have significant variables.
REP. WELCH: You were asked a question and you gave an answer. And the question was very simple. It's the kind of question that a CEO pays real attention to: What's your profit margin? Your answer was 10 percent. I'm doing the math -- 1 billion, 10 percent -- $100 million.
REP. WAXMAN: The gentleman's time has expired.
BREAK IN TRANSCRIPT
Source